- Adjusted funds flow (AFF)1 of
$5.49 /share - Record annual production of 22,587 boe / day (27% increase over 2022)
- Return on average capital employed (ROACE)1 of 21%
- Increased total proved plus probable Net Present Value by 9% year-over-year to
$2.8 billion (NPV10) - 2024 guidance reaffirmed
Message to shareholders
"I am extremely pleased with the team's performance throughout 2023. Kiwetinohk delivered robust financial and operational results, meeting or exceeding corporate expectations," said
"This success is underscored by 27% annual production growth culminating in a record annual production level of 22,587 boe/d and year-end monthly exit production of approximately 30,150 boe/d. Equally important, our commitment to safety remained unwavering with the team executing a significant capital program with zero lost time incidents or reportable spills. The strength of the Company's reserves continues to demonstrate the inherent value of our asset base. Our updated reserves report confirms a notable share price value gap. As of
"Kiwetinohk is executing on its 2024 budget priorities with a focus on financial discipline given anticipated ongoing volatility in commodity prices. Since year end, three
"We continue to make progress against project milestones across our power portfolio and are encouraged by the
_______________________________ |
1 Non-GAAP and other financial measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other entities. See "Non-GAAP and Other Financial Measures" section of the Company's MD&A for the year ended |
Financial and operating results for the quarter
Q4 2023 | Q4 2022 | 2023 | 2022 | |
Production | ||||
Oil & condensate (bbl/d) | 8,407 | 8,423 | 7,183 | 6,197 |
NGLs (bbl/d) | 3,507 | 2,664 | 2,769 | 2,012 |
Natural gas (Mcf/d) | 76,756 | 81,949 | 75,810 | 57,859 |
Total (boe/d) | 24,707 | 24,745 | 22,587 | 17,852 |
Oil and condensate % of production | 34 % | 34 % | 32 % | 35 % |
NGL % of production | 14 % | 11 % | 12 % | 11 % |
Natural gas % of production | 52 % | 55 % | 56 % | 54 % |
Realized prices | ||||
Oil & condensate ($/bbl) | 95.66 | 104.96 | 96.90 | 115.82 |
NGLs ($/bbl) | 51.44 | 68.82 | 53.07 | 74.06 |
Natural gas ($/Mcf) | 3.32 | 8.12 | 3.76 | 8.69 |
Total ($/boe) | 50.17 | 70.04 | 49.95 | 76.72 |
Royalty expense ($/boe) | (4.84) | (5.72) | (4.72) | (6.78) |
Operating expenses ($/boe) | (8.55) | (7.20) | (8.52) | (9.70) |
Transportation expenses ($/boe) | (5.49) | (5.27) | (5.61) | (5.31) |
Operating netback 1 ($/boe) | 31.29 | 51.85 | 31.10 | 54.93 |
Realized gain (loss) on risk management ($/boe) 2 | 0.23 | (6.58) | 1.50 | (13.33) |
Realized gain (loss) on risk management - purchases ($/boe) 2 | 1.20 | (2.36) | 1.69 | (5.23) |
Net commodity sales from purchases (loss) ($/boe) 1 | (0.51) | 3.16 | (0.80) | 7.07 |
Adjusted operating netback 1 | 32.21 | 46.07 | 33.49 | 43.44 |
Financial results ($000s, except per share amounts) | ||||
Commodity sales from production | 114,038 | 159,457 | 411,826 | 499,898 |
Net commodity sales from purchases (loss) 1 | (1,152) | 7,174 | (6,642) | 46,069 |
Cash flow from operating activities | 58,946 | 87,028 | 240,760 | 242,850 |
Adjusted funds flow from operations 1 | 63,697 | 101,506 | 241,311 | 264,082 |
Per share basic | 1.46 | 2.30 | 5.49 | 6.00 |
Per share diluted | 1.44 | 2.26 | 5.43 | 5.92 |
Net debt to annualized adjusted funds flow from operations 1 | 0.77 | 0.46 | 0.77 | 0.46 |
Free funds flow deficiency from operations (excluding acquisitions/dispositions) 1 | (12,713) | (1,202) | (65,674) | (5,647) |
Net income (loss) | 48,302 | 115,308 | 111,896 | 190,989 |
Per share basic | 1.11 | 2.61 | 2.54 | 4.34 |
Per share diluted | 1.09 | 2.57 | 2.52 | 4.28 |
Capital expenditures prior to (dispositions) acquisitions 1 | 76,410 | 102,708 | 306,985 | 269,729 |
Net (dispositions) acquisitions | (18,000) | — | (19,995) | 57,323 |
Capital expenditures and net (dispositions) acquisitions 1 | 58,410 | 102,708 | 286,990 | 327,052 |
Balance sheet ($000s, except share amounts) | ||||
Total assets | 1,085,615 | 932,650 | 1,085,615 | 932,650 |
Long-term liabilities | 305,735 | 221,731 | 305,735 | 221,731 |
Net debt 1 | 186,523 | 122,304 | 186,523 | 122,304 |
Adjusted working capital surplus (deficit) 1 | 7,565 | (3,105) | 7,565 | (3,105) |
Weighted average shares outstanding | ||||
Basic | 43,710,734 | 44,168,157 | 43,971,108 | 44,045,613 |
Diluted | 44,172,101 | 44,887,920 | 44,467,348 | 44,593,528 |
Shares outstanding end of period | 43,662,644 | 44,176,710 | 43,662,644 | 44,176,710 |
Return on average capital employed ("ROACE") 1 | 21 % | 30 % | ||
Reserves | ||||
Proved reserves (MMboe) 3 | 123.2 | 125.5 | ||
Proved reserves per share (boe) 3 | 2.8 | 2.9 | ||
Proved plus probable reserves (MMboe) 3 | 224.5 | 214.5 | ||
Proved plus probable reserves per share (boe) 3 | 5.1 | 4.9 |
1 – Non-GAAP and other financial measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other entities. See "Non-GAAP and Other Financial Measures" section of the Company's MD&A. |
2 – Realized gain (loss) on risk management contracts includes settlement of financial hedges on production and foreign exchange, with gains on contracts associated with purchases presented separately. |
3 – Oil and natural gas reserves are as determined by the Company's independent qualified reserve evaluator with an effective date of |
Fourth quarter highlights
- Record annual production of 22,587 boe/d, a 27% increase year-over-year. Fourth quarter production of 24,707 boe/d, grew 16.4% over the third quarter of 2023; year-end exit production for the month of
December 2023 was approximately 30,150 boe/d. - Strong quarterly operating netback2 of
$31.29 /boe drove adjusted funds from operations during the fourth quarter of$63.7 million , or$1.46 /share. This represents a 14% increase over the third quarter of 2023 and results in annual adjusted funds from operations2 of$241.3 million or$5.49 /share. - Fourth quarter capital expenditures (before acquisitions/dispositions)2 of
$76.4 million brought full year capital expenditures to$307.0 million . The capital program was executed while maintaining a strong balance sheet; the ratio of net debt to annualized adjusted funds flow from operations[2] was 0.77x atDecember 31, 2023 . - Disposed of non-core assets for proceeds of
$18.0 million in the fourth quarter bringing annual disposition total proceeds to$21.3 million in 2023 and related gains on sale of$7.6 million . The disposition of non-core assets reflects the Company's current focus on the development of its core Simonette and Placid development assets. - Return on average capital employed2 of 21% in 2023 demonstrating a strong return while significantly expanding gas processing infrastructure. Including 2022 return on average capital employed of 30%, Kiwetinohk's ROACE has averaged approximately 26% over the last two years through the development of its high quality
Duvernay andMontney assets. - Exited 2023 with
$165.6 million or 37% of capacity remaining under existing credit facilities which is available to support continued growth in 2024.
______________________ |
2 Non-GAAP and other financial measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other entities. See "Non-GAAP and Other Financial Measures" section of the Company's MD&A for the year ended |
Kiwetinohk continues to execute on its upstream and power development plans and is maintaining guidance provided on
The Company continues to protect the cash flows required to execute our program and manage commodity price risk and volatility through a prudent management program. For 2024, approximately ~50% of condensate production is hedged against WTI with an average floor price of approximately
For a detailed breakdown of guidance for 2024 please refer to the Company's MD&A for the year ended
Select 2024 Financial & Operational Guidance | ||
2024 Adjusted Funds Flow from Operations commodity pricing sensitivities 1 | ||
CAD$MM | ||
CAD$MM | ||
US$ WTI +/- | CAD$MM | +/- |
US$ | CAD$MM | +/- |
CAD$ AECO 5A +/- | CAD$MM | +/- |
Exchange Rate (CAD$/US$) +/- | CAD$MM | +/- |
2024 Net debt to Adjusted Funds Flow from Operations sensitivities 1 | ||
X | 0.7x - 0.8x | |
X | 0.4x - 0.5x |
1. | Non-GAAP measure that does not have any standardized meaning under IFRS and therefore may not be comparable to similar measures presented by other entities. Please refer to the section "Non-GAAP Measures" herein. |
2. | Assumes |
2023 year-end reserves highlights
- Conversions to PDP replaced approximately 119% of 2023 production with total proved plus probable (2P) reserve replacement of 550%.
- Grew 2P reserves by 5% or ~10.0 MMboe after dispositions (~27.1 MMboe) and annual production. Within the Company's core development areas of Simonette and Placid, 2P reserves grew by 20% or ~37.1 MMboe after annual production.
- 2P net present value (NPV10) grew by 9% year over year to
$2.8 billion (net of$0.2 billion in dispositions) with lower average year over year commodity prices. - Improved plant liquids recovery and increased total liquids share of production from 43% to 48% in Simonette in response to redeployment of capital to liquids rich inventory.
- Underlying reserve base highlights significant value relative to today's share price: PDP NPV10 (BT)
$15.70 /share; Total Proved (1P) NPV10 (BT)$35.79 /share; and 2P NPV10 (BT)$63.10 /share compared to aDecember 31, 2023 share price of$11.35 . - PDP reserve life index (RLI) of 4.60, 1P of 13.70 and 2P of 24.90 years.
- 2P finding and development costs (F&D) of
$19.84 . Over the life of the reserves, the reserve report estimates undeveloped 1P F&D costs of$18.74 /boe (future development capital divided by proved undeveloped reserves) and undeveloped 2P F&D cost of$13.97 /boe. - 3-year finding, development and acquisition (FD&A) recycle ratios were 2.4x for PDP, 2.1x for 1P and 2.6x for 2P based on the three year average operating netback of
$39.81 /boe.
Upstream operational update
In mid-November, Kiwetinohk began production from its new 14-29 four-well
Kiwetinohk has finished drilling the first two wells of its 2024 capital program, including one
There are no changes to previously disclosed upstream operating guidance, which can be referenced in the fourth quarter MD&A and the news release originally dated
Power update
In
"We support the
During the fourth quarter, Kiwetinohk advanced four power development projects through the AESO regulatory queue, with the Black Bear (NGCC) project advancing to Stage 3. The Company believes that its development portfolio remains competitively well positioned within the
Capital cost estimates for the Homestead Solar project continue to be refined as Kiwetinohk advances through detailed engineering work. The Company has continued to optimize the design and development plan for its 400
Capital cost estimates and timelines for Opal and the remaining portfolio continue to be evaluated and updated through the normal course and are expected to reflect increases related to general inflationary conditions and supply chain challenges. Pricing for Opal will be determined and disclosed as we finalize estimates in conjunction with a FID decision.
Reserves update
The reserves evaluation was based on the average forecast pricing of McDaniel's,
Future development costs (FDC) reflect McDaniel's best estimate of the future cost to bring Kiwetinohk's proved and probable developed and undeveloped reserves on production. Actual costs may be greater than or less than the estimates contained in the McDaniel Report and referenced in this news release and FDC will be re-forecast on an annual basis to account for changes in development activities, new well design or performance, inflation expectations and various other estimates.
Additional details of Kiwetinohk's 2023 year end reserves can be found in the Company's AIF available on the Company website and on the Company's profile on SEDAR+ at www.sedarplus.ca.
The following reserve summary table details the Company's 2023 gross volumetric and valuation reserve results:
Tight oil | Shale gas | Natural gas liquids | 2023 Total | 2022 Total | |
Proved producing | 827 | 132,612 | 18,293 | 41,222 | 40,399 |
Proved developed non-producing | — | 175 | 25 | 54 | 413 |
Proved undeveloped | — | 250,336 | 40,185 | 81,908 | 84,731 |
Total proved | 827 | 383,123 | 58,503 | 123,184 | 125,543 |
Probable | 161 | 314,809 | 48,642 | 101,271 | 88,924 |
Total proved plus probable | 988 | 697,932 | 107,145 | 224,455 | 214,467 |
Net present value before tax summary:
$ Millions | 0 % | 5 % | 10 % | 15 % | 20 % |
Proved developed producing | 879,351 | 797,511 | 685,480 | 599,039 | 534,060 |
Proved developed non-producing | 574 | 602 | 564 | 511 | 458 |
Proved undeveloped | 1,988,682 | 1,288,371 | 876,795 | 616,435 | 441,787 |
Total proved | 2,868,607 | 2,086,484 | 1,562,839 | 1,215,985 | 976,305 |
Probable | 3,285,837 | 1,862,022 | 1,192,487 | 832,003 | 617,405 |
Total proved plus probable | 6,154,444 | 3,948,506 | 2,755,326 | 2,047,988 | 1,593,710 |
PDP value / share 1 | $ 20.14 | $ 18.27 | $ 15.70 | $ 13.72 | $ 12.23 |
1P value / share 1 | $ 65.70 | $ 47.79 | $ 35.79 | $ 27.85 | $ 22.36 |
2P value / share 1 | $ 140.95 | $ 90.43 | $ 63.10 | $ 46.90 | $ 36.50 |
1 - based on 43,662,644 shares outstanding as of |
Future development costs ("FDC")
The following is McDaniel's estimate of FDC required to bring total proved and total proved plus probable reserves onto production:
Year | Total | Total |
2024 | 212.3 | 212.3 |
2025 | 334.4 | 334.4 |
2026 | 330.9 | 330.9 |
2027 | 342.0 | 342.0 |
2028 | 298.0 | 298.5 |
Thereafter | 17.2 | 992.6 |
Total FDC, Undiscounted | 1,534.8 | 2,510.7 |
Total FDC, Discounted at 10% | 1,206.7 | 1,720.7 |
1P/2P Future Undeveloped F&D Costs:
Proved Undeveloped | 1P | 2P | |
FDC | $MM | 1,535 | 2,510.7 |
Proved undeveloped reserves | Mboe | 81,908 | 179,720 |
F&D | $/boe | $ 18.74 | $ 13.97 |
Sustainability update
Kiwetinohk joined the
Kiwetinohk supports the Government of
Conference call, annual general meeting and first quarter 2024 reporting date
Kiwetinohk management will host a conference call on
Kiwetinohk plans to release its first quarter 2024 results prior to TSX opening on
About Kiwetinohk
We, at Kiwetinohk, are passionate about addressing climate change and the future of energy. Kiwetinohk's mission is to build a profitable energy transition business providing clean, reliable, dispatchable, affordable energy. Kiwetinohk develops and produces liquids-rich natural gas and related products and is in the process of developing renewable and natural gas-fired power generation projects with a vision of also incorporating carbon capture technology and hydrogen production, all as part of a broader, integrated portfolio of clean energy assets that will support energy transition in the markets that it serves. We view climate change with a sense of urgency, and we want to make a difference. Kiwetinohk's common shares trade on the
Oil and gas advisories
For the purpose of calculating unit costs, natural gas is converted to a barrel of oil equivalent using six thousand cubic feet of natural gas equal to one barrel of oil unless otherwise stated. The term barrel of oil equivalent (boe) may be misleading, particularly if used in isolation. A boe conversion ratio for gas of 6 Mcf:1 boe is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.
This news release includes references to sales volumes of "Oil and condensate", "NGLs" and "Natural gas" and revenues therefrom. National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities, includes condensate within the NGLs product type. The Company has disclosed condensate as combined with crude oil and separately from other NGLs since the price of condensate as compared to other NGLs is currently significantly higher, and the Company believes that this crude oil and condensate presentation provides a more accurate description of its operations and results therefrom. Crude oil therefore refers to light oil, medium oil, tight oil, and condensate. NGLs refers to ethane, propane, butane, and pentane combined. Natural gas refers to conventional natural gas and shale gas combined.
This news release contains metrics commonly used in the oil and natural gas industry. Each of these metrics is determined by the Company as set out below or elsewhere in this news release. The metrics are F&D cost, FD&A cost, recycle ratio, reserves replacement ratio (excl A&D), and reserve life index. These metrics do not have standardized meanings and may not be comparable to similar measures presented by other companies. As such, they should not be used to make comparisons. Management uses these oil and gas metrics for its own performance measurements and to provide shareholders with measures to compare the Company's performance over time; however, such measures are not reliable indicators of the Company's future performance and future performance may not compare to the performance in previous periods and therefore should not be unduly relied upon. Refer to the "Non-GAAP Financial Ratios" section of this news release for a description of the calculation and use of F&D cost, FD&A cost, recycle ratio.
F&D reserve replacement (excl A&D) is calculated by dividing: (i) the net changes to reserves in such reserves category from the prior period from extensions & improved recovery, technical revisions, economic factors, acquisitions, and dispositions, expressed in boe; by (ii) the actual annual production for the year. Reserves replacement ratio is a measure commonly used by management and investors to assess the rate at which reserves depleted by production are being replaced.
Reserve life index is calculated by dividing: (i) the reserves by category, expressed in boe; by (ii) the annualized Q4 average production rate, expressed in boe/d.
Reserves Data
Reserves data set forth in this news release is based upon an evaluation of the Company's reserves prepared by
Forward looking information
Certain information set forth in this news release contains forward-looking information and statements including, without limitation, management's business strategy, management's assessment of future plans and operations. Such forward-looking statements or information are provided for the purpose of providing information about management's current expectations and plans relating to the future. Forward-looking statements or information typically contain statements with words such as "anticipate", "believe", "expect", "plan", "intend", "estimate", "project", "potential", "may" or similar words suggesting future outcomes or statements regarding future performance and outlook. Readers are cautioned that assumptions used in the preparation of such information may prove to be incorrect. Events or circumstances may cause actual results to differ materially from those predicted as a result of numerous known and unknown risks, uncertainties and other factors, many of which are beyond the control of the Company.
In particular, this news release contains forward-looking statements pertaining to the following:
- drilling and completion activities on certain wells and pads and the expected timing for certain pads to be brought on-stream;
- expectations regardiing the Company's reserves, including the reserve life index, recycle ratios and future development costs of such reserves;
- electricity supply challenges faced by
Alberta and the combination of projects required to address the challenge through clean, reliable, dispatchable and affordable power; - receipt of regulatory approvals, including AUC transmission line approval, for the Company's power projects, including the Homestead Solar and Opal Firm Renewable projects and the timing thereof;
- the Company's ongoing engagement with federal and provincial governments with respect to regulations affecting the Company's operations;
- the timing for various projects, including the Company's Homestead Solar project, reaching FID;
- the Company's 2024 financial and operational guidance;
- the Company's operational and financial strategies and plans;
- the Company's business strategies, objectives, focuses and goals and expected or targeted performance and results;
- the Company's target to reduce vented methane emissions by 50% and the timing thereof; and
- the timing of the release of the Company's first quarter 2024 results.
Statements relating to reserves are also deemed to be forward looking information, as they involve the implied assessment, based on certain estimates and assumptions, that the reserves described exist in the quantities predicted or estimated and that the reserves can be profitably produced in the future.
In addition to other factors and assumptions that may be identified in this news release, assumptions have been made regarding, among other things:
- the Company's ability to generate a pathway to achieve additional value for shareholders through its future development program and power development portfolio;
- the Company's ability to execute on its 2024 budget priorities;
- the timing and costs of the Company's capital projects, including drilling and completion of certain wells;
- the impact of the federal government's draft clean electricity regulations on the portfolio and uncertainties regarding same;
- the timing and costs of the Company's capital projects, including drilling and completion of certain wells;
- the Company's ability to negotiate deal structures and terms on the Company's power projects;
- the impact of increasing competition;
- the general stability of the economic and political environment in which the Company operates;
- general business, economic and market conditions;
- the Company's expectations on value generation related to its power portfolio;
- the impact that the Company's projects under development will have on the power grid, including its ability to create a stable and sustainable power supply;
- the Company's expectation of a competitive position in the
Alberta power market; - the Company's unique position to deliver additional value to shareholders;
- the ability of the Company to obtain qualified staff, equipment and services in a timely and cost efficient manner;
- future commodity and power prices;
- the Company's expectations and ability to execute solar projects and the level of risk associated with curtailment;
- currency, royalty, exchange and interest rates;
- the regulatory framework regarding royalties, taxes, power, renewable and environmental matters in the jurisdictions in which the Company operates;
- the ability of the Company to obtain the required capital to finance its exploration, development and other operations and meet its commitments and financial obligations;
- the ability of the Company to secure adequate product processing, transportation, fractionation and storage capacity on acceptable terms and the capacity and reliability of facilities;
- the impact of war, hostilities, civil insurrection, pandemics (including Covid-19), instability and political and economic conditions (including the ongoing Russian-Ukrainian conflict and conflict in the
Middle East ) on the Company; - the ability of the Company to successfully market its products;
- power project debt will be held at the project level;
- power projects will be funded by third parties, as currently anticipated;
- expectations regarding access of oil and gas leases in light of caribou range planning; and
- the Company's operational success and results being consistent with current expectations.
Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions that have been used. Although the Company believes that the expectations reflected in such forward- looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements as the Company can give no assurance that such expectations will prove to be correct.
Forward-looking statements or information involve a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by the Company and described in the forward-looking statements or information. These risks and uncertainties include, among other things:
- those risks set out in the Annual Information Form (AIF) under "Risk Factors";
- the ability of management to execute its business plan;
- general economic and business conditions;
- risks of war, hostilities, civil insurrection, pandemics (including Covid-19), instability and political and economic conditions (including the ongoing Russian-Ukrainian conflict and conflict in the
Middle East ) in or affecting jurisdictions in which the Company operates; - the risks of the power and renewable industries;
- operational and construction risks associated with certain projects;
- the possibility that government policies or laws may change or governmental approvals may be delayed or withheld;
- risks relating to regulatory approvals and financing;
- the ability to market in
Alberta for power projects; - uncertainty involving the forces that power certain renewable projects;
- the Company's ability to enter into or renew leases;
- potential delays or changes in plans with respect to power and solar projects or capital expenditures;
- risks associated with rising capital costs and timing of project completion;
- fluctuations in commodity and power prices, foreign currency exchange rates and interest rates;
- risks inherent in the Company's marketing operations, including credit risk;
- health, safety, environmental and construction risks;
- risks associated with existing and potential future lawsuits and regulatory actions against the Company;
- uncertainties as to the availability and cost of financing;
- the ability to secure adequate processing, transportation, fractionation and storage capacity on acceptable terms;
- processing, pipeline and fractionation infrastructure outages, disruptions and constraints;
- financial risks affecting the value of the Company's investments; and
- other risks and uncertainties described elsewhere in this document and in Kiwetinohk's other filings with Canadian securities authorities.
Readers are cautioned that the foregoing list is not exhaustive of all possible risks and uncertainties.
The forward-looking statements and information contained in this news release speak only as of the date of this news release and the Company undertakes no obligation to publicly update or revise any forward-looking statements or information, except as expressly required by applicable securities laws.
Non-GAAP and other financial measures
This news release uses various specified financial measures including "non-GAAP financial measures", "non-GAAP financial ratios" and "capital management measures", as defined in National Instrument 52-112 Non-GAAP and Other Financial Measures Disclosure and explained in further detail below. These non-GAAP and other financial measures presented in this news release should not be considered in isolation or as a substitute for performance measures prepared in accordance with IFRS and should be read in conjunction with the Financial Statements and MD&A. Readers are cautioned that these non-GAAP measures do not have any standardized meanings and should not be used to make comparisons between Kiwetinohk and other companies without also taking into account any differences in the method by which the calculations are prepared.
Please refer to the Corporation's MD&A as at and for the year ended
Non-GAAP Financial Measures
Capital expenditures, capital expenditures and net acquisitions (dispositions), operating netback, adjusted operating netback, and net commodity sales from purchases (loss), are measures that are not standardized measures under IFRS and might not be comparable to similar financial measures presented by other companies.
The most directly comparable GAAP measure to capital expenditures and capital expenditures and net acquisitions (dispositions) is cash flow used in investing activities. The most directly comparable GAAP measure to operating netback and adjusted operating netback is commodity sales from production. The most directly comparable GAAP measure to net commodity sales from purchases (loss) is commodity sales from purchases.
Capital Management Measures
Adjusted funds flow from operations, free funds flow (deficiency) from operations, adjusted working capital surplus (deficit), net debt, net debt to annualized adjusted funds flow from operations and net debt to adjusted funds flow from operations are capital management measures that may not be comparable to similar financial measures presented by other companies. These measures may include calculations that utilize non-GAAP financial measures and should not be considered in isolation or construed as alternatives to their most directly comparable measure disclosed in the Company's primary financial statements or other measures of financial performance calculated in accordance with IFRS.
Capital expenditures, capital expenditures and net acquisitions, F&D cost, FD&A cost, and recycle ratio, presented on a $/boe basis are non-GAAP ratios as they each have a non-GAAP financial measure as a component. These measures are not standardized measures under IFRS and might not be comparable to similar financial measures presented by other companies. These measures should not be considered in isolation or construed as alternatives to their most directly comparable measure disclosed in the Company's primary financial statements or other measures of financial performance calculated in accordance with IFRS.
F&D costs are calculated by dividing: (i) capital expenditures, excluding power projects (a non-GAAP financial measure) for the applicable reserves category and period; by (ii) the net changes to reserves in such reserves category from the prior period from extensions & improved recovery, technical revisions, and economic factors, expressed in boe. F&D costs are a measure commonly used by management and investors to assess the relationship between capital invested in oil and gas exploration and development projects and reserve additions.
FD&A costs are calculated by dividing: (i) capital expenditures and net acquisitions, excluding power acquisitions (a non-GAAP financial measure) for the applicable reserves category and period; by (ii) the net changes to reserves in such reserves category from the prior period from extensions & improved recovery, technical revisions, economic factors, acquisitions, and dispositions, expressed in boe. FD&A costs are a measure commonly used by management and investors to assess the relationship between capital invested in oil and gas exploration and development projects, acquisitions net of dispositions, and reserve additions.
Recycle ratio is calculated by dividing the netback (a non-GAAP financial measure) per boe for the period by the F&D costs or the FD&A costs for the period. Recycle ratio is used by investors and management to compare the cost of adding reserves to the netback realized from production.
Readers should refer to the information under the heading "Statement of Reserves Data – Reserves Reconciliation" in the Company's Annual Information Forms ("AIF") for the year ended
Supplementary Financial Measures
This news release contains supplementary financial measures expressed as: (i) cash from operating activities, adjusted funds flow on a per share – basic and per share – diluted basis, (ii) realized prices, petroleum and natural gas sales, adjusted funds flow, revenue, royalties, operating expenses, transportation, realized loss on risk management, and net commodity sales from purchases on a $/bbl, $/Mcf or $/boe basis and (iii) royalty rate.
Cash from operating activities, adjusted funds flow and free cash flow on a per share – basic and diluted basis are calculated by dividing the cash from operating activities, adjusted funds flow or free cash flow, as applicable, over the referenced period by the weighted average basic or diluted shares outstanding during the period determined under IFRS.
Metrics presented on a $/bbl, $/Mcf or $/boe basis are calculated by dividing the respective measure, as applicable, over the referenced period by the aggregate applicable units of production (bbl, Mcf or boe) during such period.
Royalty rate is calculated by dividing royalties by petroleum and natural gas sales less royalty and other revenue.
Future oriented financial information
Financial outlook and future-oriented financial information referenced in this news release about prospective financial performance, financial position or cash flows is based on assumptions about future events, including economic conditions and proposed courses of action, based on management's assessment of the relevant information currently available. These projections contain forward-looking statements and are based on a number of material assumptions and factors set out above and are provided to give the reader a better understanding of the potential future performance of the Company in certain areas. Actual results may differ significantly from the projections presented herein. These projections may also be considered to contain future oriented financial information or a financial outlook. The actual results of the Company's operations for any period will likely vary from the amounts set forth in these projections, and such variations may be material. See "Risk Factors" in the Company's AIF published on the Company's profile on SEDAR+ at www.sedarplus.ca for a further discussion of the risks that could cause actual results to vary. The future oriented financial information and financial outlooks contained in this news release have been approved by management as of the date of this news release. Readers are cautioned that any such financial outlook and future-oriented financial information contained herein should not be used for purposes other than those for which it is disclosed herein.
Abbreviations
$/bbl | dollars per barrel |
$/boe | dollars per barrel equivalent |
$/Mcf | dollars per thousand cubic feet |
AESO | Alberta Electric Systems Operator |
AIF | Annual Information Form |
AUC | |
bbl/d | barrels per day |
boe | barrel of oil equivalent, including crude oil, condensate, natural gas liquids, and natural gas (converted on the basis of one boe per six Mcf of natural gas) |
Mboe | thousand barrels of oil equivalent |
MMboe | million barrels of oil equivalent |
boe/d | barrel of oil equivalent per day |
DCET | Drill, Complete, Equip and Tie-in |
FID | Final Investment Decision |
Mcf | thousand cubic feet |
Mcf/d | thousand cubic standard feet per day |
MD&A | Management Discussion & Analysis |
MMcf/d | million cubic feet per day |
MW | one million watts |
NGLs | natural gas liquids, which includes butane, propane, and ethane |
For more information on Kiwetinohk, please contact:
Investor Relations
IR email: IR@kiwetinohk.com
IR phone: (587) 392-4395
SOURCE
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